Why would long term investors and society as a whole care about high frequency traders? They pay their fair share of taxes to society as anybody else. No high frequency traders, less govt income. So you want to exempt yourself but get rid of institutional traders?
News articles about the Financial Transaction Tax
- Thread starter Math_Wiz
- Start date
We may have a misunderstanding.
Taxes need to be raised to pay for all the crap the admin promised. Can't pull it directly out of peoples pockets. Why not say we pulled it out of evil financiers pockets (though in the end all investors will pay for it through higher transaction costs). It won't be the end of professional traders, only for those who have a high turnover. 10 or 15bp transaction costs (even one way) will bring a 100 fold more than the pity they currently collect in taxes from those firms and guys. Hft is a thorn in the eyes of the democratic party. They don't mind their existence but don't care to tax the hell out of them either. What's not to comprehend about those simple relationships?
Taxes need to be raised to pay for all the crap the admin promised. Can't pull it directly out of peoples pockets. Why not say we pulled it out of evil financiers pockets (though in the end all investors will pay for it through higher transaction costs). It won't be the end of professional traders, only for those who have a high turnover. 10 or 15bp transaction costs (even one way) will bring a 100 fold more than the pity they currently collect in taxes from those firms and guys. Hft is a thorn in the eyes of the democratic party. They don't mind their existence but don't care to tax the hell out of them either. What's not to comprehend about those simple relationships?
NY Weighs A "Wall Street Tax." Wall Street Is Threatening To Flee
BY CHRISTOPHER ROBBINS
FEB. 5, 2021 9:03 A.M.
• 247 COMMENTS
The floor of the New York Stock Exchange before the pandemic hit last spring. RICHARD DREW/AP/SHUTTERSTOCK
On Wednesday, a trade group representing some the most powerful economic markets in the world wrote a letter to Governor Andrew Cuomo, outlining their opposition to the creation of any new taxes on stock trading in New York.
"While some see this as a tax on the securities industry itself, it is actually a tax on working families saving for retirement and college, pension funds that secure retirement for millions, as well as many individual investors, foundations and endowments," the group wrote. Imposing any form of a stock market tax, they noted, "could lead financial firms to move their back-office operations and related jobs outside of New York."
As Congress continues to debate the size and scope of a federal pandemic relief package, the state faces a $15 billion budget shortfall and many difficult choices. One of Cuomo's budget proposals includes higher income taxes on wealthy New Yorkers, an idea he had long dismissed. New York City has lost hundreds of thousands of jobs during the pandemic, and the economy may be years away from a full recovery. In response, state legislators have prepared a menu of new tax bills targeting the rich, including a billionaire's tax, and a tax on stock transfers.
New York has taxed stock trades since 1905, charging a percentage of the stock's value to whichever party initiates the trade, for trades that occur in the state, with a $350 daily maximum. But in 1981, the state effectively stopped collecting the tax, and has returned any money that it accrues—last year, that amounted to more than $4 billion.
"The hard truth is, New York needs the securities industry more than the securities industry needs New York. The city can't afford a tax that pushes it out of town," the NY Times editorial board wrote in 1983, when efforts to revive the tax were discussed.
One recent proposal in the State Senate, would lower the 100% rebate on the current stock transfer tax to 60%. Another Assembly proposal would completely eliminate the rebate, and increases the scope of the tax to include any party that works or lives in New York state.
Earlier this week, Brooklyn State Senator Julia Salazar widened the net further, and introduced a "Wall Street Tax." The tax would capture 0.5% of the value of stock trades, 0.1% of bond trades, and .005% of derivative trades. The proposal is similar to a federal tax pitched by Vermont Senator Bernie Sanders, and Salazar's legislation states it would raise between $12 and $29 billion annually. According to the State Comptroller, the financial industry netted more than $26 billion in pre-tax profits for the first six months of 2020, more than all of 2019. The average salary for its 182,000 workers was more than $400,000, and they represented 18% and 6% of all state and city tax collections.
Senator Salazar told Gothamist that the devastation caused by the pandemic has created a sense of urgency among her fellow lawmakers to propose and support legislation that some may not have previously considered.
"There’s more solidarity, honestly, and then maybe there’s a development of class consciousness," Salazar said. "And then there’s been the reporting and the acknowledgement that there are corporations and individuals, billionaires in the state, whose profits have increased over the course of the last ten months. And I think people recognize the fundamental unfairness and injustice in that."
New York State Governor Andrew Cuomo rings the opening bell New York Stock Exchange to mark the historic reopening of the NYSE Trading Floor on May 26, 2020. COURTNEY CROW/AP/SHUTTERSTOCK
Steven Rosenthal, a senior fellow at the Tax Policy Institute at the Urban Institute & Brookings Institution, said that a state stock transfer tax would not soak everyday investors and retirees, despite the arguments made by the financial industry.
"They tell you that the stockholders are pension funds, workers, and the little man. And that’s wrong. It’s like, rich guys, overwhelmingly," Rosenthal said. He pointed to federal data showing that the wealthiest 10 percent of households owned an average $1.7 million in stock, while households in the bottom 50 percent owned an average of $11,000.
Rosenthal said that one of the main arguments in favor of a state stock transfer tax—that it would indeed raise billions of dollars—could also work against it. The Wall Street Tax legislation would create a "residency test" to see whether the exchange, or the broker, or the party itself resided in New York. Most of the trading on the New York Stock Exchange currently happens on computer servers in New Jersey, and the stockbrokers themselves may find it more competitive to leave the state if they have to pass fees on to their customers. (When New Jersey threatened to tax the NYSE's servers in September, the market responded by transferring trades to Chicago.)
"The question is, when you raise a lot of money, what are the distortions? And one distortion is simply moving trade, and that definitely has to be addressed. And I’m skeptical that can be addressed by a state-level tax," Rosenthal said.
This is the Citizens Budget Commission's basis for opposing a revival of the stock transfer tax. "If the tax goes back into effect as written, many trades would simply move to other states to avoid the tax," the group wrote in the fall, adding that widening the tax the way the Wall Street Tax proposal states "would put New York securities firms at a competitive disadvantage."
"Faced with a STT in New York State, firms are likely to relocate trading activity outside of the State to offer a better price for their clients, taking jobs and related economic activity with them," the securities trade group wrote to Cuomo. The two largest markets in the world, the NYSE and NASDAQ, both signed the letter.
Monica Klein, a spokesperson for Invest In Our New York, the group that is advocating for higher taxes on wealthy New Yorkers, insisted that avoiding the Wall Street Tax would be "no small task."
"Businesses and traders would have to entirely move to another state, or at least significantly relocate their trading operations. These businesses depend on our highly developed labor markets, infrastructure, and government regulation, and they would lose far more than they would gain if they moved out of the state," Klein wrote in an email.
Governor Cuomo's office has pledged to review any new legislation. The governor has not signaled support for any new taxes except higher income taxes on the wealthy, and only in the event of a shortage of federal aid, while the leaders of the state legislature have said they are interested in doing more.
In 1966, New York City Mayor John Lindsay asked the state legislature to increase the stock transfer tax to fund libraries, parks, hospitals, community colleges, and programs to fight poverty. "The budget is large, but the needs of the city are great," Lindsay said, as recounted in Kim Phillips-Fein's Fear City.
In response, "The New York Stock Exchange threatened to leave the city altogether if the stock transfer tax went through, relocating to Connecticut or perhaps even California," Phillips-Fein wrote. The president of the NYSE "barraged local newspapers with letters" and pleaded with the publisher of the New York Times, A.O. Sulzberger. The tax increase ultimately passed, and the NYSE remained in New York.
"I think that if opponents of the proposal, namely, ultra-wealthy people and lobbyists for the financial industry, thought that this tax could simply be avoided, then they wouldn’t be so actively opposing it," Salazar said. "Because they don’t want to pay more taxes."
https://gothamist.com/news/ny-weighs-wall-street-tax-wall-street-threatening-flee
BY CHRISTOPHER ROBBINS
FEB. 5, 2021 9:03 A.M.
• 247 COMMENTS
The floor of the New York Stock Exchange before the pandemic hit last spring. RICHARD DREW/AP/SHUTTERSTOCK
On Wednesday, a trade group representing some the most powerful economic markets in the world wrote a letter to Governor Andrew Cuomo, outlining their opposition to the creation of any new taxes on stock trading in New York.
"While some see this as a tax on the securities industry itself, it is actually a tax on working families saving for retirement and college, pension funds that secure retirement for millions, as well as many individual investors, foundations and endowments," the group wrote. Imposing any form of a stock market tax, they noted, "could lead financial firms to move their back-office operations and related jobs outside of New York."
As Congress continues to debate the size and scope of a federal pandemic relief package, the state faces a $15 billion budget shortfall and many difficult choices. One of Cuomo's budget proposals includes higher income taxes on wealthy New Yorkers, an idea he had long dismissed. New York City has lost hundreds of thousands of jobs during the pandemic, and the economy may be years away from a full recovery. In response, state legislators have prepared a menu of new tax bills targeting the rich, including a billionaire's tax, and a tax on stock transfers.
New York has taxed stock trades since 1905, charging a percentage of the stock's value to whichever party initiates the trade, for trades that occur in the state, with a $350 daily maximum. But in 1981, the state effectively stopped collecting the tax, and has returned any money that it accrues—last year, that amounted to more than $4 billion.
"The hard truth is, New York needs the securities industry more than the securities industry needs New York. The city can't afford a tax that pushes it out of town," the NY Times editorial board wrote in 1983, when efforts to revive the tax were discussed.
One recent proposal in the State Senate, would lower the 100% rebate on the current stock transfer tax to 60%. Another Assembly proposal would completely eliminate the rebate, and increases the scope of the tax to include any party that works or lives in New York state.
Earlier this week, Brooklyn State Senator Julia Salazar widened the net further, and introduced a "Wall Street Tax." The tax would capture 0.5% of the value of stock trades, 0.1% of bond trades, and .005% of derivative trades. The proposal is similar to a federal tax pitched by Vermont Senator Bernie Sanders, and Salazar's legislation states it would raise between $12 and $29 billion annually. According to the State Comptroller, the financial industry netted more than $26 billion in pre-tax profits for the first six months of 2020, more than all of 2019. The average salary for its 182,000 workers was more than $400,000, and they represented 18% and 6% of all state and city tax collections.
Senator Salazar told Gothamist that the devastation caused by the pandemic has created a sense of urgency among her fellow lawmakers to propose and support legislation that some may not have previously considered.
"There’s more solidarity, honestly, and then maybe there’s a development of class consciousness," Salazar said. "And then there’s been the reporting and the acknowledgement that there are corporations and individuals, billionaires in the state, whose profits have increased over the course of the last ten months. And I think people recognize the fundamental unfairness and injustice in that."
New York State Governor Andrew Cuomo rings the opening bell New York Stock Exchange to mark the historic reopening of the NYSE Trading Floor on May 26, 2020. COURTNEY CROW/AP/SHUTTERSTOCK
Steven Rosenthal, a senior fellow at the Tax Policy Institute at the Urban Institute & Brookings Institution, said that a state stock transfer tax would not soak everyday investors and retirees, despite the arguments made by the financial industry.
"They tell you that the stockholders are pension funds, workers, and the little man. And that’s wrong. It’s like, rich guys, overwhelmingly," Rosenthal said. He pointed to federal data showing that the wealthiest 10 percent of households owned an average $1.7 million in stock, while households in the bottom 50 percent owned an average of $11,000.
Rosenthal said that one of the main arguments in favor of a state stock transfer tax—that it would indeed raise billions of dollars—could also work against it. The Wall Street Tax legislation would create a "residency test" to see whether the exchange, or the broker, or the party itself resided in New York. Most of the trading on the New York Stock Exchange currently happens on computer servers in New Jersey, and the stockbrokers themselves may find it more competitive to leave the state if they have to pass fees on to their customers. (When New Jersey threatened to tax the NYSE's servers in September, the market responded by transferring trades to Chicago.)
"The question is, when you raise a lot of money, what are the distortions? And one distortion is simply moving trade, and that definitely has to be addressed. And I’m skeptical that can be addressed by a state-level tax," Rosenthal said.
This is the Citizens Budget Commission's basis for opposing a revival of the stock transfer tax. "If the tax goes back into effect as written, many trades would simply move to other states to avoid the tax," the group wrote in the fall, adding that widening the tax the way the Wall Street Tax proposal states "would put New York securities firms at a competitive disadvantage."
"Faced with a STT in New York State, firms are likely to relocate trading activity outside of the State to offer a better price for their clients, taking jobs and related economic activity with them," the securities trade group wrote to Cuomo. The two largest markets in the world, the NYSE and NASDAQ, both signed the letter.
Monica Klein, a spokesperson for Invest In Our New York, the group that is advocating for higher taxes on wealthy New Yorkers, insisted that avoiding the Wall Street Tax would be "no small task."
"Businesses and traders would have to entirely move to another state, or at least significantly relocate their trading operations. These businesses depend on our highly developed labor markets, infrastructure, and government regulation, and they would lose far more than they would gain if they moved out of the state," Klein wrote in an email.
Governor Cuomo's office has pledged to review any new legislation. The governor has not signaled support for any new taxes except higher income taxes on the wealthy, and only in the event of a shortage of federal aid, while the leaders of the state legislature have said they are interested in doing more.
In 1966, New York City Mayor John Lindsay asked the state legislature to increase the stock transfer tax to fund libraries, parks, hospitals, community colleges, and programs to fight poverty. "The budget is large, but the needs of the city are great," Lindsay said, as recounted in Kim Phillips-Fein's Fear City.
In response, "The New York Stock Exchange threatened to leave the city altogether if the stock transfer tax went through, relocating to Connecticut or perhaps even California," Phillips-Fein wrote. The president of the NYSE "barraged local newspapers with letters" and pleaded with the publisher of the New York Times, A.O. Sulzberger. The tax increase ultimately passed, and the NYSE remained in New York.
"I think that if opponents of the proposal, namely, ultra-wealthy people and lobbyists for the financial industry, thought that this tax could simply be avoided, then they wouldn’t be so actively opposing it," Salazar said. "Because they don’t want to pay more taxes."
https://gothamist.com/news/ny-weighs-wall-street-tax-wall-street-threatening-flee
NY Weighs A "Wall Street Tax." Wall Street Is Threatening To Flee
BY CHRISTOPHER ROBBINS
FEB. 5, 2021 9:03 A.M.
• 247 COMMENTS
The floor of the New York Stock Exchange before the pandemic hit last spring. RICHARD DREW/AP/SHUTTERSTOCK
On Wednesday, a trade group representing some the most powerful economic markets in the world wrote a letter to Governor Andrew Cuomo, outlining their opposition to the creation of any new taxes on stock trading in New York.
"While some see this as a tax on the securities industry itself, it is actually a tax on working families saving for retirement and college, pension funds that secure retirement for millions, as well as many individual investors, foundations and endowments," the group wrote. Imposing any form of a stock market tax, they noted, "could lead financial firms to move their back-office operations and related jobs outside of New York."
As Congress continues to debate the size and scope of a federal pandemic relief package, the state faces a $15 billion budget shortfall and many difficult choices. One of Cuomo's budget proposals includes higher income taxes on wealthy New Yorkers, an idea he had long dismissed. New York City has lost hundreds of thousands of jobs during the pandemic, and the economy may be years away from a full recovery. In response, state legislators have prepared a menu of new tax bills targeting the rich, including a billionaire's tax, and a tax on stock transfers.
New York has taxed stock trades since 1905, charging a percentage of the stock's value to whichever party initiates the trade, for trades that occur in the state, with a $350 daily maximum. But in 1981, the state effectively stopped collecting the tax, and has returned any money that it accrues—last year, that amounted to more than $4 billion.
"The hard truth is, New York needs the securities industry more than the securities industry needs New York. The city can't afford a tax that pushes it out of town," the NY Times editorial board wrote in 1983, when efforts to revive the tax were discussed.
One recent proposal in the State Senate, would lower the 100% rebate on the current stock transfer tax to 60%. Another Assembly proposal would completely eliminate the rebate, and increases the scope of the tax to include any party that works or lives in New York state.
Earlier this week, Brooklyn State Senator Julia Salazar widened the net further, and introduced a "Wall Street Tax." The tax would capture 0.5% of the value of stock trades, 0.1% of bond trades, and .005% of derivative trades. The proposal is similar to a federal tax pitched by Vermont Senator Bernie Sanders, and Salazar's legislation states it would raise between $12 and $29 billion annually. According to the State Comptroller, the financial industry netted more than $26 billion in pre-tax profits for the first six months of 2020, more than all of 2019. The average salary for its 182,000 workers was more than $400,000, and they represented 18% and 6% of all state and city tax collections.
Senator Salazar told Gothamist that the devastation caused by the pandemic has created a sense of urgency among her fellow lawmakers to propose and support legislation that some may not have previously considered.
"There’s more solidarity, honestly, and then maybe there’s a development of class consciousness," Salazar said. "And then there’s been the reporting and the acknowledgement that there are corporations and individuals, billionaires in the state, whose profits have increased over the course of the last ten months. And I think people recognize the fundamental unfairness and injustice in that."
New York State Governor Andrew Cuomo rings the opening bell New York Stock Exchange to mark the historic reopening of the NYSE Trading Floor on May 26, 2020. COURTNEY CROW/AP/SHUTTERSTOCK
Steven Rosenthal, a senior fellow at the Tax Policy Institute at the Urban Institute & Brookings Institution, said that a state stock transfer tax would not soak everyday investors and retirees, despite the arguments made by the financial industry.
"They tell you that the stockholders are pension funds, workers, and the little man. And that’s wrong. It’s like, rich guys, overwhelmingly," Rosenthal said. He pointed to federal data showing that the wealthiest 10 percent of households owned an average $1.7 million in stock, while households in the bottom 50 percent owned an average of $11,000.
Rosenthal said that one of the main arguments in favor of a state stock transfer tax—that it would indeed raise billions of dollars—could also work against it. The Wall Street Tax legislation would create a "residency test" to see whether the exchange, or the broker, or the party itself resided in New York. Most of the trading on the New York Stock Exchange currently happens on computer servers in New Jersey, and the stockbrokers themselves may find it more competitive to leave the state if they have to pass fees on to their customers. (When New Jersey threatened to tax the NYSE's servers in September, the market responded by transferring trades to Chicago.)
"The question is, when you raise a lot of money, what are the distortions? And one distortion is simply moving trade, and that definitely has to be addressed. And I’m skeptical that can be addressed by a state-level tax," Rosenthal said.
This is the Citizens Budget Commission's basis for opposing a revival of the stock transfer tax. "If the tax goes back into effect as written, many trades would simply move to other states to avoid the tax," the group wrote in the fall, adding that widening the tax the way the Wall Street Tax proposal states "would put New York securities firms at a competitive disadvantage."
"Faced with a STT in New York State, firms are likely to relocate trading activity outside of the State to offer a better price for their clients, taking jobs and related economic activity with them," the securities trade group wrote to Cuomo. The two largest markets in the world, the NYSE and NASDAQ, both signed the letter.
Monica Klein, a spokesperson for Invest In Our New York, the group that is advocating for higher taxes on wealthy New Yorkers, insisted that avoiding the Wall Street Tax would be "no small task."
"Businesses and traders would have to entirely move to another state, or at least significantly relocate their trading operations. These businesses depend on our highly developed labor markets, infrastructure, and government regulation, and they would lose far more than they would gain if they moved out of the state," Klein wrote in an email.
Governor Cuomo's office has pledged to review any new legislation. The governor has not signaled support for any new taxes except higher income taxes on the wealthy, and only in the event of a shortage of federal aid, while the leaders of the state legislature have said they are interested in doing more.
In 1966, New York City Mayor John Lindsay asked the state legislature to increase the stock transfer tax to fund libraries, parks, hospitals, community colleges, and programs to fight poverty. "The budget is large, but the needs of the city are great," Lindsay said, as recounted in Kim Phillips-Fein's Fear City.
In response, "The New York Stock Exchange threatened to leave the city altogether if the stock transfer tax went through, relocating to Connecticut or perhaps even California," Phillips-Fein wrote. The president of the NYSE "barraged local newspapers with letters" and pleaded with the publisher of the New York Times, A.O. Sulzberger. The tax increase ultimately passed, and the NYSE remained in New York.
"I think that if opponents of the proposal, namely, ultra-wealthy people and lobbyists for the financial industry, thought that this tax could simply be avoided, then they wouldn’t be so actively opposing it," Salazar said. "Because they don’t want to pay more taxes."
https://gothamist.com/news/ny-weighs-wall-street-tax-wall-street-threatening-flee
I'm not a fan of Cuomo but it would be financial suicide for New York if he were to support and pass this tax. Stranger things have happened but I don't see this happening at all...
-Guru
https://www.thecentersquare.com/ill...cle_df1afc9e-67ed-11eb-8418-3fcb785d5f20.html
"The U.S. House Financial Services Committee on Feb. 18 will hold a hearing titled “Game Stopped? Who Wins and Loses When Short Sellers, Social Media and Retail Investors Collide.”"
"The U.S. House Financial Services Committee on Feb. 18 will hold a hearing titled “Game Stopped? Who Wins and Loses When Short Sellers, Social Media and Retail Investors Collide.”"
Here's a better way than Gamestop attacks for the 'lttile guy' to stock it to Wall Street:
https://www.marketwatch.com/story/h...k-it-to-wall-street-11612765598?siteid=yhoof2
https://www.marketwatch.com/story/h...k-it-to-wall-street-11612765598?siteid=yhoof2
New York FTT: Express Your Opposition
by Jim Toes
As states across the nation face 2021 budget gaps due to the COVID-19 pandemic, legislation had been introduced in the New York State Senate that would amend its state's tax laws to include a tax on financial transactions.
Senate Bill S3980 is the most extensive and complex bill of its kind, as measured by the types of transactions that are covered, the entities responsible to pay and the number of rates.
While S3980 remains in the Committee on Budget and Revenue and has not been voted upon, it represents a serious threat to the financial services industry, one that would most likely lead to an exodus of firms from New York.
S3980 is very broad in its application and would tax transactions of equities, bonds and other financial instruments, specifically defining covered securities subject to its tax as:
(1) any share of stock in a corporation;
(2) any partnership or beneficial ownership interest in a partnership or trust;
(3) any note, bond, debenture, or other evidence of indebtedness, other than a state or local bond the interest of which is excluded from gross income under section 103(a) of the internal revenue code;
(4) any evidence of an interest in, or a derivative financial instrument with respect to, any security or securities described in subparagraph one, two, or three of this paragraph;
(5) any derivative financial instrument with respect to any currency or commodity including notional principal contracts;
(6) any other derivative financial instrument and payment with respect to which is calculated by reference to any specified index.
In addition, S3980 covers transactions that are "cleared on a qualified board or exchange located in the state, or is executed by a broker in the state."
While harmful enough if only New York enacts an FTT, it would be particularly damaging to investors if more than one state implements a similar FTT. For example, if a broker dealer located in New York routes an order to an exchange located in another state that has a similar FTT, then the trade would be taxed twice. Taking this two steps further and assuming all states adopt a similar FTT, one transaction could be subject to four taxes: an investor places a trade in one state, executes through a broker dealer in another state, who then routes the order to an exchange in a third state, and the trade is cleared by an entity in a fourth state.
At the federal level, Rep. Patrick McHenry and Rep. Bill Huizenga have introduced new legislation that would prohibit states from imposing a tax on trades by citizens outside of their own borders by taxing the intermediaries those interstate citizens rely upon. The Bill titled, Protecting Retirement Savers and Everyday Investors Act does not prohibit states and localities from imposing FTTs on their own citizens.
STA opposes FTTs because we believe they are ultimately paid by the end investor in that the costs will be directly passed on to them. They also result in higher trading costs due to wider spreads, which lowers performance on their investment vehicles. We believe there are flaws inherent to any FTT, regardless of how they are structured.
If you share these beliefs and you reside in the state of New York, please express your opposition to your state representative. We have provided a template letter and the proper links for you to do so at the end of this article.
Download Senate Bill S3980 PDF here.
Express Your Opposition Today
For those of you who reside in the state of New York and oppose the state's Senate taxon financial transactions, please take a moment to express your opposition to your state legislator and senator.
By following the simple steps below, you can exercise your right of representation on this, and other issues that are of importance to you.
Don't know who your state representatives are? Click the link in Step #1.
Act Today!
Step #1
Locate your state legislator assembly person here.
Locate your state senator here.
Step #2
Follow instructions for contacting your state assembly person or senator.
Step #3
Copy, paste and edit the Template Letter below as you see fit and send.
Template Letter
Subject: Oppose Financial Transaction Tax and Stock Transfer Tax Legislation
Dear _______,
I am writing to express my strong opposition to Senate Bill S3980 and any other legislation that would impose a tax on financial transactions or that would re-impose any form of a stock transfer tax. As a resident of New York State, I am very concerned that if Senate Bill S3980 or similar legislation were enacted it would result in significant economic harm to New York, as it would encourage financial firms to move trading activity to other states in order to remain competitive. The reduced economic activity resulting from such a tax regime would translate to a net loss in revenues to the state. It would also hinder the efforts of New York State individual investors in reaching their long-term financial retirement and savings goals.
If a tax on financial transactions is enacted, trading and financial firms in New York State will likely relocate trading activity to other states in order to remain competitive in offering the best prices for their clients. These firms would take jobs and economic activity with them, which will inevitably lead to lower revenues to New York State. Evidence from other countries’ efforts to impose similar financial transaction tax (FTT) regimes have failed to raise the revenue promised, as trading volumes decrease due to trading activity migrating to other countries. FTT regimes also lead to less trading, resulting in lower liquidity, higher costs, and increased price volatility due to reduced trading volume and higher spreads.
Over an investor’s lifetime, a seemingly small tax becomes a large tax on their savings, which will result in the need to work longer to reach retirement or other savings goals. An FTT would have a similar negative impact on public pension funds and their beneficiaries, lowering the expected returns of such funds. While most FTT proposals appear on the surface to be small, they add up to significant costs for individual investors. These costs can be even more significant to Main Street investors if the tax can be applied multiple times in their portfolio, including but not limited to the purchase of mutual funds, the mutual fund’s purchase of individual stocks and bonds, the mutual fund rebalancing its funds, and individual investors rebalancing their portfolios.
I urge you to express your opposition to, and vote against, any legislation that would impose a tax on financial transactions or reinstate a stock transfer tax in New York State. Such legislation would negatively impact the New York economy, result in a net revenue decline for New York State, and make it harder for investors, including pension fund beneficiaries, to reach their financial goals.
Thank you.
Sincerely,
Additional Resources
November 2020 - Press release on Protecting Retirement Savers and Everyday Investors Act
February 2021: STA of New York, STANY letter to New York State Governor Cuomo and Senate opposing NY State Transfer Tax
September 2020: New Jersey's FTT: Express Your Opposition
February 2019: FTT; This Time It's Different, Or Is It?
October 2015: What's Right About an FTT?
Lawmakers should avoid impulse to tax all stock trades:
This is an op-ed from FL House Democrat:
https://www.thecentersquare.com/nat...cle_28dc166c-6a21-11eb-9ebf-3f4a9e4f6b63.html
This is an op-ed from FL House Democrat:
https://www.thecentersquare.com/nat...cle_28dc166c-6a21-11eb-9ebf-3f4a9e4f6b63.html
It's time to impose a COVID-19 equity surcharge on Wall Street:
https://thehill.com/opinion/finance...se-a-covid-19-equity-surcharge-on-wall-street
From the piece:
The main difference between my suggested surcharge and the DeFazio bill is that the surcharge investments are targeted and the surcharge itself is temporary. It also avoids references to “taxes.” We have learned that labels make a difference.
https://thehill.com/opinion/finance...se-a-covid-19-equity-surcharge-on-wall-street
From the piece:
The main difference between my suggested surcharge and the DeFazio bill is that the surcharge investments are targeted and the surcharge itself is temporary. It also avoids references to “taxes.” We have learned that labels make a difference.
NYSE chief warns it may exit New York is stock transfer tax is imposed:
https://finance.yahoo.com/news/nyse-chief-warns-may-exit-202758912.html
The idea of a new transaction tax seems to have little support with the governor's office.
When the topic came up at a January press conference, Budget Director Robert Mujica said a lot of ideas around such taxes "haven't been fleshed out," according to a copy of the remarks provided to Reuters by an official in the New York State Division of the Budget.
Mujica pointed to a financial tax that had been proposed last year in New Jersey, where many exchanges host their servers, and noted that the exchanges quickly mobilized to temporarily move their employees and activity outside of the state.
The pandemic has shown people can do business anywhere, he said. "So if we increase the tax like that, you mobilize people, potentially just move your transactions and your servers to another part of the country where those taxes don't exist."
https://finance.yahoo.com/news/nyse-chief-warns-may-exit-202758912.html
The idea of a new transaction tax seems to have little support with the governor's office.
When the topic came up at a January press conference, Budget Director Robert Mujica said a lot of ideas around such taxes "haven't been fleshed out," according to a copy of the remarks provided to Reuters by an official in the New York State Division of the Budget.
Mujica pointed to a financial tax that had been proposed last year in New Jersey, where many exchanges host their servers, and noted that the exchanges quickly mobilized to temporarily move their employees and activity outside of the state.
The pandemic has shown people can do business anywhere, he said. "So if we increase the tax like that, you mobilize people, potentially just move your transactions and your servers to another part of the country where those taxes don't exist."